Russia is at war with Ukraine and so effectively at war with Europe, Lithuania's president claimed today as European leaders threatened to impose further sanctions on Vladimir Putin.

The dramatic comments from Dalia Grybauskaite come after officials in Kiev accused Moscow of using tanks to 'flatten' the border town of Novosvitlivka.

During an EU summit in Brussels today, David Cameron said it was vital to address the 'unacceptable' situation of having Russian troops on Ukrainian soil.

The Prime Minister has insisted there must be 'consequences' if an estimated 1,000 Russian troops are not withdrawn from the east of the country.

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Russia is at war with Ukraine and so effectively at war with Europe, Lithuania's president claimed today. Above, a pro-Russian rebel watches as Ukrainian troops are evacuated from the rebel-held town of Starobesheve

Two men carry an Ukrainian government soldier injured by tank fire to an ambulance in the rebel-held town

Ukrainian army personnel load the body of a dead government soldier into a truck in Starobesheve today

A pro-Russian rebel aims his rifle as he observes territory in the rebel-held town of Starobesheve, Ukraine

Lithuania's President Dalia Grybauskaite (left) talks with British Prime Minister David Cameron, center, and Denmark's Prime Minister Helle Thorning-Schmidt, during an EU Summit. She said that Russia is 'practically' at war with the rest of Europe

Ahead of the meeting, Grybauskate told reporters: 'It
is the fact that Russia is in a war state against Ukraine. That means
it is in a state of war against a country which would like to be closely
integrated with the EU. Practically Russia is in a state of war against
Europe.

'That
means we need to help Ukraine to ... defend its territory and its
people and to help militarily, especially with the military materials to
help Ukraine to defend itself because today Ukraine is fighting a war
on behalf of all Europe,' the leader of the former Soviet state said.

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She
added that an arms embargo on Russia should be stepped up by including a
halt to sales under existing contracts - a swipe notably at France,
which has resisted calls to cancel a deal to sell Moscow a strategic new
warship.

Outgoing
European commission president Jose Manuel Barroso said the situation
was in danger of reaching 'the point of no return'.

Orphans perch on the top of their cribs in the Ukrainian town of Makeyevka after they were relocated from Donetsk in the wake of the fighting

A nurse cradles one of the 70 children who have been evacuated to the orphanage

A medic wearing a mask inspects the children who have been relocated as a result of the increase in tensions

Ukrainian government forces have succumbed to a sequence of military failures and seen their holdings in the conflict-ridden east shrink in recent days as Russian-backed rebels continue their fast-paced offensive

The Prime Minister has insisted there must be 'consequences' if an estimated 1,000 Russian troops are not withdrawn from the east of the country. Above, a pro-Russian rebel watches as Ukrainian troops are evacuated

The sanctions were discussed after Nato released images apparently showing Russian forces and an array of heavy weaponry in Ukraine.

However,
Mr Putin has denied that his forces are in Ukraine - and upped his own
rhetoric by reminding critics that Russia has nuclear weapons.

Following the attack on Novosvitlivka, Ukraine military spokesman Andriy Lysenko told journalists in Kiev Russian tanks had and fired on every house in the community.

'We have information that virtually every house has been destroyed,' Lysenko said.

There were also accusations that Ukrainian fighter jet was been shot down by a
Russian missile during combat against the rebels.

Stockpille: A Ukrainian soldier walks past a pile of shells stored inside a trench in Donetsk

Ukrainian President Petro Poroshenko (left) shakes hands with British Prime Minister David Cameron(right) as they meet ahead of a European Council meeting in Brussels, Belgium, today

Poroshenko (left) and Cameron (right) are pictured chatting ahead of the summit in Brussels

Polish Prime Minister Donald Tusk (left) and Cameron (right) are seen speaking at the start of the meeting

A rocket and smoke trails are seen as rockets are launched from a Ukrainian army position towards pro-Russian separatists near Debaltseve, Donetsk, today

A
brief statement posted on the Facebook page for the so-called operation
against separatists said the Su-25 was hit yesterday, and that the
pilot ejected and was uninjured.

It said the plane was hit by a missile from a Russian launcher, but did not give more detail.

Mr
Cameron, who earlier held talks with Ukraine president Petro Poroshenko
at a nearby hotel, said: 'We have to address the completely unacceptable
situation of having Russian troops on Ukraine soil.

'Consequences must follow if that situation continues and we will be discussing that as well today.'

Today, pro-Russian rebels were spotted watching as Ukrainian troops were evacuated from Starobesheve in eastern Ukraine. And yesterday, Ukrainian forces showed off a cache of weapons that they had seized from Russian forces

Military attaches examine a Russian weapons cache - including rocket launchers - seized by the Ukrainian army on displayed in Kiev

Volunteers assist the Ukrainian army by digging trenches near Mariupol in a bid to help defend the area from pro-Russian rebels

In addition to denying that its forces are in Ukraine, Russia consistently rejecting allegations that it is supplying the rebels.Until this week, the fighting had been concentrated well inland.

But rebels have taken control of the
town of Novoazovsk with the apparent aim of pushing further west along
the coast which connects Russia to the Russia-annexed Crimean Peninsula.

The expansion of the four-month-old conflict raised strong calls by the West for Russia to back off its involvement in Ukraine.

Several
European Union foreign ministers yesterday accused Russia of invading
eastern Ukraine and said Moscow should be punished with additional
economic sanctions.

'We
see regular Russian army units operating offensively on the Ukrainian
territory against the Ukrainian army,' said Swedish foreign minister
Carl Bildt. 'We must call a spade a spade.'

The effort by volunteers in the Donetsk region as European leaders meet in Brussels to consider fresh sanctions against Putin

A burned trolleybus is seen near Donetsk train station after shelling in the region over night

Fighting
between Ukrainian military forces and Russian-backed separatists in
eastern Ukraine has already claimed at least 2,200 lives, according to
UN figures.

European
Union leaders are today poised to slap additional sanctions on Russia
because of what they condemn as a continued destabilization of Ukraine
and a deepening military involvement by Moscow.

The
28-nation bloc's heads of state and government on Saturday were also
set to discuss possible further assistance for Ukraine as the country's
president, Petro Poroshenko, was expected to brief the leaders in
Brussels on the situation.

Additional
EU sanctions would aim at inflicting more economic pain in hopes of
changing what is viewed as Russian meddling in Ukraine.

A woman passes by burnt-out shops in Donetsk as fighting continues to intensify in the region

President of European Council Herman Van Rompuy today welcomed Ukrainian President Porochenko for a meeting at the EU Headquarters in Brussels